Icon revenue rises but expenses weigh on profits

IRISH CLINICAL trials company Icon saw revenue rise last year, but profits dipped as expenses at the company rose.

Net revenue rose by 5.1 per cent to $946 million, compared with $900 million in 2010. But costs jumped almost $100 million to $906.5 million. That dragged operating income down to $39.3 million, before one-off charges were taken into account, compared with $92 million in 2010.

The company, which provides outsourced development services to the pharmaceutical, biotechnology and medical device industries, undertook a number of cost reduction steps over the year, which incurred restructuring costs.

In October last year, Icon said it planned a share buy-back programme of up to $50 million that would begin in the fourth quarter.

In the last three months of the year, Icon said net revenues were 5 per cent higher compared to a year earlier, rising to $242.6 million. Operating income was $6.6 million, about 3 per cent of revenue. That compares with $22 million or 9 per cent for the same period a year earlier.

Pretax income was $5.9 million in the fourth quarter of the year, down from $22.5 million a year earlier.

Chief executive Ciaran Murray said the quarterly performance was encouraging.

“Earnings in the quarter increased to $0.07 [per share]. With this level of backlog growth and continuing success in developing our strategic partnerships, we expect revenue to grow steadily through the remainder of 2012 and be in the range of $1.07-$1.11 billion,” he said.

The company invested $10.7 million in capital expenditure in the fourth quarter of the year, and acquired Chinese clinical research organisation BeijingWits Medical Consulting Ltd.

The purchase follows the acquisition of Limerick clinical trials company Firecrest Clinical for $24.4 million in July, and British pharmaceutical company Oxford Outcomes earlier in the year.

The firm also announced the appointment of Brendan Brennan as chief financial officer, formalising the role he has held on an acting basis since last October.

Globally, Icon employs approximately 8,500 people, including 640 at its headquarters in Sandyford in Dublin.